On April 26, 2007, about 1515 Pacific daylight time, a Cessna 150L, N1557Q, nosed over during a forced landing at Watsonville Municipal Airport, Watsonville, California. FlyGirl Aviation was operating the airplane under the provisions of 14 CFR Part 91. The certified flight instructor (CFI) sustained minor injuries, and the student pilot was not injured. The airplane sustained substantial damage. The local instructional flight was departing at the time of the accident. Visual meteorological conditions prevailed, and no flight plan had been filed. The approximate global positioning system (GPS) coordinates of the primary wreckage were 35 degrees 56.08 minutes north latitude and 121 degrees 47.22 minutes west longitude. The CFI submitted a written statement. He met the student at the gas pumps. The student reported that the airplane had 7 gallons on preflight, and she added 10 more. They drained fuel to check for water, and found none. They strapped in, and started the engine. They taxied to the run up area, and completed their final checklists. The CFI estimated that 10 to 15 minutes elapsed before traffic cleared so that they could take off. The CFI stated that the takeoff was normal, and they started their climb to the practice area. About 200 to 300 feet agl, the engine started to lose power; it didn't just quit. He took control. He applied carburetor heat, and pumped the throttle a few times as he had done in the past to keep an engine running. However, the engine didn't respond. The airplane was over the end of the runway. The CFI felt that they were too low to turn around, and wanted to get the airplane down before they flew past the clear area before a freeway. He aimed for a wheat field that he thought would cushion the landing. He estimated that about 40 seconds elapsed from the loss of power to touchdown. The wheat in the field was 4-feet tall, and a lot thicker than the CFI expected. It stopped the airplane on touchdown, causing a nose over. He saw fire in the engine compartment. He instructed the student to be careful unstrapping since they were inverted, but to hurry. They both exited out the right side door, and cleared the airplane. He began clearing a path to the runway as bystanders arrived with fire extinguishers. The CFI realized he had a deep gash on his leg, so he sat down in grass once he cleared the wheat field, and waited for assistance. The FAA coordinator examined the airplane and engine, and found no abnormalities to preclude normal operation.